THE road logistics market in India is expected to grow at a compounded annual growth rate of 8 per cent in the next five years, to reach USD 330 billion by 2025, as per a report. This growth will be fueled by factors such as the rapidly growing e-commerce sector and a growing retail sales market, among others, according to ‘Inter-city Logistics Market Study’, released by consulting firm RedSeer’s early stage research arm, RedCore on Thursday. As per the report, the road logistic market in India is to grow at a compounded annual growth rate (CAGR) of 8 per cent in the next five years making it a USD 330 billion market by 2025.

 

The inter-city road logistics spend in India stood at USD 209 billion in 2021, accounting for around 87 per cent of total road logistics spend, as per the study. Out of this, the on-demand/spot market accounted for 63 per cent of the total spend, while the contract market accounted for 37 per cent. On-demand/spot freight transport is the movement of goods on an immediate basis with prompt payments, which helps in satisfying unfulfilled and urgent demands.

 

It counts sectors such as defence, PSUs, agriculture, food and FMCG, and building materials, among others, as its key clients. According to the report, metros accounted for as much as 40 per cent or USD 84-billion, of the total inter-city logistics spend of USD 209 billion. Noting that logistics costs in relation to GDP is an indicator of how efficiently businesses can operate, the report added.